Joint National Bank of Belgium / Toulouse School of Economics / Solvay Brussels School of Economics and Management / European Central Bank conference

Managing financial crises: where do we stand?

Monday, 5 and Tuesday, 6 November 2018
Brussels

The European Central Bank, the National Bank of Belgium, the Toulouse School of Economics and the Solvay Brussels School of Economics and Management are pleased to announce a conference on “Managing financial crises: where do we stand?” to be held in Brussels at the National Bank of Belgium on 5 and 6 November 2018. This event is designed to provide a platform for leading policymakers and academics to exchange views on the experience gained and lessons learnt from managing the financial crisis that erupted a decade ago. It will be composed of keynote speeches and panel sessions. Each panel session will start with presentations by each of the speakers, followed by responses from the invited discussants and a Q&A session with the audience.

The financial crisis triggered profound changes in global economic and financial policy. The conference will discuss the various policy responses in the monetary, macroprudential and regulatory fields. It will aim not only to take stock of events, but also to assess, with the benefit of hindsight, whether the overall set of measures, taken individually or collectively through international coordinated action, has made our economies and their financial systems safer and more resilient than they were a decade ago.

Programme

Monday, 5 November 2018

13:15
Registration and coffee
13:35

Welcome address

Jan Smets, Governor, NBB

13:45

Introductory remarks

Herman Van Rompuy, Former President, European Council

14:00

Keynote speech

Luis de Guindos, Vice-President, ECB

The ECB and Financial Stability

14:30
Coffee break
15:00

Panel 1
Risk-sharing in European Monetary Union: how can we achieve more risk-sharing through financial markets?

The first panel aims to draw lessons from the past on issues relating to private sector risk-sharing in the specific context of European Monetary Union. The financial system should generally provide for such risk-sharing mechanisms, but the crisis has shown that excessive risk-taking in the private sector eventually resulted in financial fragmentation and had to be dealt with by the public sector. What can be done to promote a more resilient financial system that shares risks across the euro area? How effective will banking union and capital markets union be? What is still missing and how important is a public backstop in this context?

Chair: Guntram Wolff, Director, Bruegel

Speakers:
Emmanuel Farhi, Professor, Harvard University
Mahmood Pradhan, Deputy Director, European Department, IMF
Beatrice Weder di Mauro, President, CEPR

Discussants:
Laurence Boone, Chief Economist, OECD
Paul De Grauwe, Professor, LSE

16:45
Coffee break
17:30

Panel 2
Euro area governance: is it fit to address the next crisis?

An appropriate balance between private and public sector risk-sharing is crucial to the design of a resilient institutional set-up for crisis management. In this context, the second panel will examine the respective roles of the central bank, the European Stability Mechanism, the fiscal authorities, the resolution authority and the competition authority. Are their respective roles clear? Is there sufficient coordination among the various authorities? How can governance be improved and is there a need for a euro area finance ministry?

Chair: Margarita Delgado, Deputy Governor, Banco de España

Speakers:
Jeromin Zettelmeyer, Senior Fellow, Petersson Institute for International Economics
André Sapir, Professor, Solvay Brussels School
Guido Tabellini, Professor, Bocconi University

Discussants:
Vítor Constancio, Former Vice-President, ECB
Olivier Guersent, Director-General, European Commission

19:00

Day ends

Tuesday, 6 November 2018

8:00
Registration and coffee
8:30

Panel 3
Lender of last resort: who should do what?

The third panel will examine the issue of market liquidity and how to deal with bank runs in a complex and integrated post-crisis financial system. The occurrence of sudden liquidity shortages in specific market segments will be compared with the phenomenon of liquidity dry-outs in the balance sheets of financial intermediaries, in particular banks. Against this backdrop, sovereign debt financing in crisis times will be discussed, with reference to the bank-sovereign “doom loop”. Finally, panellists will share their conclusions on the so-called Bagehot doctrine and its implications for central banks, in particular their independence, their role in the provision of liquidity to markets, and their status in the debate on the centralisation of the lender of last resort function.

Chair: Peter Praet, Member of the Executive Board, ECB

Speakers:
Martin Hellwig, Director, Max Planck Institute for Research on Collective Goods
Hyun Song Shin, Head of Research, BIS
Jean Tirole, President, Toulouse School of Economics

Discussants:
Elena Carletti, Professor, Bocconi University
Charles Goodhart, Professor, LSE

10:15
Coffee break
10:30

Panel 4
Dealing with solvency issues through bail-ins and bail-outs: how should we view the “too big to fail” problem and moral hazard issues after the crisis?

The fourth panel will debate solvency issues and consider bail-in and bail-out mechanisms. The “too big to fail” problem and moral hazard issues will be revisited with the benefit of hindsight.

Chair: Pierre Wunsch, Vice-Governor, NBB

Speakers:
Mathias Dewatripont, Professor, Solvay Brussels School
Elke König, Chair, Single Resolution Board
Jean-Charles Rochet, Professor, Geneva University

Discussants:
Thorsten Beck, Professor, Cass Business School
Alberto Franco Pozzolo, Professor, Università degli Studi del Molise

12:15

Panel 5
Financial crisis management in the current international monetary system

To close the conference, the fifth panel will look at cooperative crisis management in the context of the multilateral system and its current strengths and weaknesses. It will assess the progress made and set-backs encountered in improving the international financial architecture. Panellists will take a closer look at macroprudential measures such as the standards on total loss-absorbing capacity. The international role of currencies will also be discussed against the backdrop of heightened financial interconnectedness.

Chair: Benoît Coeuré, Member of the Executive Board, ECB

Speakers:
Patrick Bolton, Professor, Columbia University
Barry Eichengreen, Professor, University of California-Berkeley
Paul Tucker, Senior Fellow, Harvard University

Discussants:
Pier Carlo Padoan, Member of the Italian Parliament
Isabelle Mateos y Lago, Managing Director, Blackrock

14:00

Closing and light buffet lunch